Young Mens Christian Assoc of Birmingham

“These funds are administered by trustees who are nominated by the board of directors of the ymca. The trustees have sole authority to invest, sell, pledge and otherwise administer these funds for the sole benefit of the ymca. Accordingly, these funds are considered unrestricted assets. Gifts, bequests and realized gains and losses on sales of endowment assets are considered to be part of the corpus and are retained within the endowment funds under the direction of the trustees. Expendable income from endowment assets is used to fund programs and supporting services as designated by the trustees of the endowment funds.”

“The ymca is exempt from federal income taxes under section 501(c)(3) of the internal revenue code. Management believes that all revenue-producing activities of the ymca comply with section 501(c)(3) of the internal revenue code. Accordingly, no accrual for taxes has been made. The ymca adopted accounting standards relating to uncertainty of income tax positions. Management assessed whether there were any uncertain tax positions that may give rise to income tax liabilities and determined that there were no such matters requiring recognition in the accompanying financial statements. The ymca files income tax returns in the u.s. Federal jurisdiction. With few exceptions, the ymca is no longer subject to u.s. Federal, state and local or non-u.s. Income tax examinations for years before 2013.”

“Gain on interest rate swap 186,432. Unrealized gain on investments -234,605. Cost of goods sold - merchandise sold 232,664.”

“Cost of goods sold - merchandise sold 232,664.”

“In order to manage fluctuations in interest rates on the 2008 lease agreement, the ymca entered into an interest rate swap agreement. The interest rate swap agreement functions as a hedge of cash flow variability caused by changes in interest rates. The differential interest required to be paid or that will be received under this agreement is accrued consistent with the terms of the agreement and is recognized in interest expense as accrued. Terms of the swap agreement require the differential interest to be paid or received monthly. Generally accepted accounting principles require derivative instruments, such as interest rate swap agreements, to be recognized at fair value as either assets or liabilities in the statement of financial position. Accordingly, the negative $475,043 and $661,475 value of the swap agreement at december 31, 2017 and 2016, respectively, is reported as a liability in the statement of financial position. Any change in the swap's value is recognized as a change in unrestricted net assets for the years ended december 31, 2017 and 2016. Value has been measured based on estimates of the amount needed to settle the agreement as calculated by the counterparty to the swap agreement. Such calculations were based on changes in market conditions and/or assumptions underlying valuation models. The notional principal amount of the swap agreement is $6,7599,906 and $7,450,840 at december 31, 2017 and 2016, respectively. The agreement effectively fixes the ymca's interest rate exposure at 4.34 percent. The change in unrestricted net assets recognized on the underlying bonds resulted in a total gain of $186,432 and $199,968 for the years ended december 31, 2017 and 2016, respectively. The maturity of the swap agreement coincides with that of the underlying bonds in december 2023.”